â€œThe mainstream of academic research in macroeconomics puts theoretical coherence and elegance first, and investigating the data second,â€ says Mr. Rogoff. For that reason, he says, much of the professionâ€™s celebrated work â€œwas not terribly useful in either predicting the financial crisis, or in assessing how it would it play out once it happened.â€

â€œ[Academic economists] almost pride themselves on not paying attention to current events,â€ he says.

Pure Veblen, who in Theory of the Leisure Class provided many examples of people, including professors, priding themselves on being useless. Men wear ties, he said, to show they don’t do manual labor (which is clearly useful).

My research is closer to biology, where you can say the same thing: much of the profession’s celebrated work has not been terribly useful. Yesterday I gave an example (the oncogene theory of cancer).

8 Replies to “More Flight From Data”

The difference between useless economics (i.e., all economic research that comes out of academia) and useless biology is that useless biology is practically useless, but it at least reveals some underlying truth about biology; conversely useless economics is completely disconnected from anything to do with economics: it’s pure mathematical games.

Just to add, the lessons behind most microeconomics is the type of stuff which Seth supports (decentralization is preferable to centralization, people act on their own self-interest, transparency is important, etc…).

It’s an important subject that doesn’t get enough attention from educators.

thehova, the type of microeconomics you refer to are ideas that have been around since at least Adam Smith. You clearly haven’t been exposed to any academic research in microeconomics of the last 50+ odd years.

I hope that Rogoff is as critical of the IMF during his tenure — at the time, to work there you needed to have a PhD in economics by the age of 32, plus related work experience. So basically, people who prioritized academics and also excelled at them. Did the resulting homogeneity in thinking produce good policy? Would it create rich debate and dialogue in the institution? Or did it allow delusion to persist indefinitely?I don’t know what their hiring policies are like now, but fear massive, ossified bureaucracies like the IMF lack incentives to improve. The people in the insitution who could make the decision to change hiring policy were hired for their supposed superiority based on their academic history. For them to change the hiring policy would be like admitting the emperor had no clothes — academic success is not equivalent to being able to provide real-world value.